Sunday, January 27, 2008

The Shortest Refinance Boom Ever?

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So it seems, despite the touting of IndyMac's Michael Perry that the lender had locked over a billion dollars in loans on January 23rd, that most were too late to the party. The above mortgage interest rate trend chart and Google Trends chart below show the short drop in rates compared to the spike in inquiries as borrowers responded in mass to headline news that mortgage rates had plunged.

Some believe that that the stock recovery was profit taking by investors short on financial and housing related stocks. I tend to agree with Perry's optomistic outlook, despite the fact that there are hundreds of thousands of potential borrowers who missed the boat, there will be others that set sail as the year progresses, and we see an increased conforming loan amount, FHA reform, and rates will return to their descent after the Bernanke sponsored Wall Street shorting party ends and we get back to reality.